title: [ARFC] Update USDS Borrow Rate
author: @TokenLogic
created: 2025-04-05
Summary
The Sky Savings Rate (SSR) has been set to be decreased from 6.50% to 4.50% on March 20th. This proposal recommends updating the USDS Borrow Rate accordingly.
Motivation
Following the recent proposal to adjust the SSR to 4.50% , this publication recommends aligning other key parameters by reducing the Base on Core and Slope1 on Prime by 2.00% each. This adjustment would ensure coherence with the new rate framework.
The chart below highlights the deposit rates for USDC and USDT on Aave over the past 90 days in comparison to the SSR. Even after the SSR was lowered ten days ago, it continues to offer superior yields relative to USDC and USDT. This is primarily driven by the ongoing decline in borrowing rates for these assets since mid-December. In this context, depositing SUSDS remains a much more compelling option for yield generation.
Specification
Prime Instance
Detail | Current | Proposed | Change |
---|---|---|---|
Base | 0.75% | 0.75% | 0.00% |
Slope1 | 6.50% | 4.50% | -2.00% |
Slope2 | 35.00% | 35.00% | 0.00% |
Borrow Rate at Uoptimal 5.25%, exceeding SSR by 0.75%.
Core Instance
Detail | Current | Proposed | Change |
---|---|---|---|
Base | 6.50% | 4.50% | -2.00% |
Slope1 | 0.75% | 0.75% | 0.00% |
Slope2 | 35.00% | 35.00% | 0.00% |
Borrow Rate at Uoptimal 5.25%, exceeding SSR by 0.75%.
Disclosure
TokenLogic does not receive any payment for this proposal.
Next Steps
- Implement the proposed parameter changes via a Direct-to-AIP process.
Copyright
Copyright and related rights waived via CC0.